Mohawk Industries Stock Near Crucial Support – Buy Signal?
Mohawk Industries (MHK) stock should be on your watchlist. Here is why – it is currently trading in the support zone ($119.42 – $132.00), levels from which it has bounced meaningfully before. In the last 10 years, Mohawk Industries stock received buying interest at this level 8 times and subsequently went on to generate 35.6% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 12/20/2018 | 23.9% | 54 |
| 3/22/2019 | 25.2% | 125 |
| 8/19/2019 | 33.4% | 80 |
| 11/2/2020 | 100.3% | 186 |
| 4/1/2022 | 27.0% | 33 |
| 4/23/2024 | 8.7% | 22 |
| 6/28/2024 | 43.2% | 31 |
| 7/10/2025 | 22.8% | 63 |
But is the price action enough alone? It certainly helps if the fundamentals check out. For MHK Read Buy or Sell MHK Stock to see how convincing this buy opportunity might be.
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure.
Here are some quick data points for Mohawk Industries that should help decision:
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- Revenue Growth: -1.6% LTM and -3.1% last 3 year average.
- Cash Generation: Nearly 4.5% free cash flow margin and 5.9% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in last 3 years for MHK was -4.1%.
- Valuation: MHK stock trades at a PE multiple of 16.5
- Opportunity vs S&P: Compared to S&P, you get lower valuation, lower revenue growth, and lower margins
For quick background, Mohawk Industries provides diverse flooring products including wood, vinyl, laminates, roofing elements, and insulation boards across North America and global markets, featuring various colors, textures, and patterns.
| MHK | S&P Median | |
|---|---|---|
| Sector | Consumer Discretionary | – |
| Industry | Home Furnishings | – |
| PE Ratio | 16.5 | 23.9 |
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| LTM* Revenue Growth | -1.6% | 5.2% |
| 3Y Average Annual Revenue Growth | -3.1% | 5.3% |
| Min Annual Revenue Growth Last 3Y | -4.1% | -0.1% |
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| LTM* Operating Margin | 5.9% | 18.6% |
| 3Y Average Operating Margin | 5.6% | 17.8% |
| LTM* Free Cash Flow Margin | 4.5% | 13.3% |
*LTM: Last Twelve Months
What Is Stock-Specific Risk If The Market Crashes?
That said, MHK isn’t immune to big drops. It fell over 54% in the Dot-Com Bubble and took an even steeper hit of 83% in the Global Financial Crisis. The 2018 correction and Covid plunge both wiped out around 60%. Even the Inflation Shock saw a drop nearing 67%. Solid fundamentals don’t guarantee smooth rides — when the market turns, MHK has shown it can still take a hard fall.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read MHK Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.